Making Sense of the Volkswagen Diesel Dilemma

The Volkswagen/Audi diesel engine scandal is going to have a long-lasting impact on new and used diesel car sales in the United States. It will especially be a problem for owners who might be trapped with cars they cannot sell that are suddenly worth less money.

Volkswagen has been accused by the EPA and the California Air Resources Bureau of manipulating emissions testing on several of its diesel cars from 2009 to 2015. The results showed the vehicles passing the test while in reality they exceeded standards by 40 times acceptable levels. The discrepancies were discovered by an independent group called the International Council on Clean Transportation. It thought VW’s claims on clean diesels were suspect and conducted independent testing.

Volkswagen said in a statement that it apologizes for breaking the trust of its customers and the public. It has admitted to installing special devices on its 2.0-liter TDI engines to make them seem compliant with emissions standards.

golf vw tdi diesel scandal photo

What’s not known is the immediate impact on consumers. Volkswagen stocks have dropped 20 percent in value as the German automaker faces a potential maximum fine of $18 billion for the 482,000 vehicles covered in the allegations. The EPA says the company manipulated results for the 2009 to 2015 model year Jetta, Beetle, Audi A3 and Golf. Also included is the 2014 to 2015 model year Passat.

The great unknown at this point is what the impact is going to be on current owners. Volkswagen has suspended sales of new models of the affected cars. It claims owners have no safety concerns but doesn’t address the issue of decreased value and possible fixes.

2015-Volkswagen-Jetta-Tdi

Currently, the major problem is the affected Volkswagens can’t pass emissions testing. Regulators in affected states will have to come up with remedies for re-testing all of the cars before they can be sold to consumers or re-sold by consumers to other buyers.

There’s also the issue of consumers paying a premium for diesels when bought new. That advantage has disappeared in all likelihood and now consumers could be considered at a disadvantage because they will be paying more for their cars than they are worth.

The good news for consumers is there no immediate impact. Their vehicles are not going to drive any differently until repairs are made. They will continue to get the same fuel economy as always.

Potentially, though, fuel economy numbers could drop once software changes are made or new hardware is added. Volkswagen has not indicated what the repair will be and if consumers who bought the affected vehicles will be able to get financial compensation.